DTN Cotton Open: Market Steady, Awaits USDA Data

Photo: Kay Ledbetter, Texas AgriLife Extension

The cotton market held unchanged all night in anticipation of Thursday’s weekly sales and exports, followed by supply-demand data for September. Sales have been decent enough of late, but the entire cotton industry wants to see China back in the business mix. To that end, new U.S.-China trade talks are scheduled for next month.

A potential motivator for the Chinese to get serious about a deal was the election of a Republican candidate in the North Carolina last night. Many political analysts saw that election as a precursor for the U.S. presidential election next year. Thus, if the Chinese perceives President Trump remaining politically strong, it may behoove them to deal now, rather than later.

Also Thursday, USDA will present is latest supply-demand findings. Last month, the August report had traders scratching their heads as protection jumped to a 14-year high and exports were unrealistically upped to 17.20 million. Since that time, field conditions have been such that the development of the crop has most likely gone backwards.

India’s crop has been an on-again, off-again endeavor. Initially, the monsoonal activity dramatically waned, well below the 50-year average. Then monsoons “overly improved”, bringing massive flooding into key production areas. It may be USDA will sizably cut India’s production Thursday. If that is the case, then India’s loss should allow more headway for U.S. exports.

For today, close-in support for December Cotton stands at 58.50 cents, with 60.65 cents and 61.60 cents as overhead resistance. Overnight estimated volume is 3,055 contracts traded.

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